McAuliffe Corporation issued $200,000 of 6.0% 10-year bonds. The bonds are dated and sold on January 1, 2015. Interest payment dates are January 1 and July 1. The bonds are issued for $185,788 to yield the market interest rate of 7%. On the first semiannual interest payment date, July 1, 2015, the company recorded $6,503 in interest expense and $503 in discount amortization. The interest payment is $6,000. Using the effective interest method, what is the carrying amount of the bonds on the January 1, 2016 balance sheet? O A. $186,291 OB. $200,000 O C. $186,811 OD. $185,788